Fix The Falls: Casino Impact

In 2002, the former Niagara Falls Convention Center found a new occupant in the Seneca Niagara Casino. The casino was heavily anticipated at its opening with the thinking of some being the casino would become a needed boost to the city’s economy that was on a downward trend.

At the time Niagara Falls New York, was seeing lows in economic growth. During this time many saw the casino as, “creating a large revenue generator in the middle of an otherwise very poor city”, as described by then City Council member Paul Dyster, who is the city’s current mayor, and who is on record saying he was a not supporter of the casino at the time.

Another member of the city’s government Maria Brown agreed with Dyster and opposed the casino, but recalls the city not having enough money to meet its obligations.

Brown is a firm believer in raising revenue through sales and property taxes. Her biggest issue with the casino that resides on 52 acres of downtown real estate is the fact unlike other businesses the casino does not pay property or sales tax, as direct a result of the casino’s agreement with the state.

Now that both Brown and Dyster are able to reflect over the casino’s impact on the local economy, both are able to conclude that the casino has had an overall positive effect on the city and its economy.

Dyer is quoted saying of the casino’s impact on the city, “the city of Niagara Falls, even with the loss of sales tax revenue I think the is ahead. That’s my personal opinion.”

Brown chimed in on the casino’s impact as well by saying, “I would say on balance has it been a benefit for us to have it … quite clearly it is.”

The deal was structured between the Seneca Nation and New York State. A part of the deal the State of New York and the City of Niagara Falls split 25% of the casino’s revenue generated from slot machines into equal portions.

While the percentage at first may seem minuscule to split between the city and state, the deal has generated $183 million dollars for the city alone.

Brown is careful to note that the city’s portion is not the city’s alone. In accordance with the deal the city must give portions of the revenue made from the casino to Niagara Falls Memorial Hospital, the city school district, the Niagara Tourism and Convention Corporation, and the NFTA. All of the payouts most recently accounted for $5.3 million coming off the top by Brown’s account.

All of the payouts lowered the in take of the city to $132 million, and that is still a respectable number.

Percentage wise Niagara Falls property owners pay some of the highest rates in the nation compared to the value of the property owned. This fact leads Brown to theorize that if the city was able to retain the entire amount received from the casino, and apply it to lowering the city’s property tax, property owners might benefit from the lowest property taxes in the nation.

Supporting her theory Brown explains the current tax levy is approximately $29 million dollars a year. By using the revenue gained from the casino for the levy, property taxes could nearly be “whipped out.”

The reason why Brown is unable to push her plan to lower the property taxes for property owner in the city, is that the State has regulated how the revenue can be spent by the city.

The revenue is currently being spent items like housing projects, a new culinary institute, a new train station, and paying toward the city’s debt associated with its public safety building and courthouse.

Brown and other city officials held on to high hopes of restructuring the deal with the casino when is expired next year. Yet in an attempt to end a feud between Governor Andrew Cuomo and casino owners (the Seneca), Cuomo extended the agreement to 2023. Cuomo was under pressure to resolve the issue due to the Seneca withholding their payments to the state.

With one stroke of the pen, Cuomo crushed any hopes the city had of restructuring a new deal.

Mayor Dyster has since complained that the city should have been a part of the negotiations, and just being “privy” to information does not go far enough in representing the city’s interest during negotiation.

Recent economic decline for the casino has led to a decline in the payments to the city and state as well.

With Cuomo’s new effort to grow the state’s gaming industry by expanding the number of casinos statewide, the city of Niagara Falls could see the casino’s profits tank even more.

Keeping in mind the old saying nothing good last forever, Dyster might be having a little “buyers remorse” over the city’s spending on the new train station and a recent Holiday Market venture.

While acknowledging that suggestions for how the money is spent comes from his office, Dyster is firm in is stance that the final decisions were approved by the City Council, and not his office.

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1 Comment

  1. Interesting, how the niagara falls people can enjoy the lowest tax rate in the nation, so the casino subsidy the people there.. Good thinking. As long as people can get the benefit from it, no one can deny the good impact from the casino there..

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